Apple stock is tanking Thursday after the tech giant's quarterly earnings beat profit expectations but paired that win with a gloomy current-quarter forecast. Wall Street said thanks but no thanks, and the selloff is hitting Silicon Valley where it hurts.
Related: Apple Stock Price Falling Today: What California Investors Need to Know About AAPL's Drop · THE TRAITOROUS EIGHT: HOW A 1957 WALKOUT IN MOUNTAIN VIEW BUILT SILICON VALLEY
The Cupertino company posted a 27% jump in profits, per early reports. Strong numbers by almost any measure. Wall Street didn't care. Investors locked onto the forward guidance, which disappointed, and the stock slumped in after-hours trading, according to Yahoo Finance.
Then outgoing CEO Tim Cook made things worse. On what was reportedly his final Apple earnings call, Cook warned investors about a so-called "100-year flood" in memory chip pricing, according to Fortune. That's not the kind of language that calms anyone down. The man who turned Apple into the world's most valuable company choosing that metaphor, on that call, spooked markets fast. His looming exit is already a storyline investors are watching closely.
What's Driving the Drop
Expectations. Apple cleared a high bar on profits but its forward guidance came in below what analysts had penciled in. When a company Apple's size misses on its outlook, the ripple runs wide. Pension funds, index funds, millions of individual California investors. All feel it. Cook's memory chip pricing warning only deepened the concern about near-term costs.
What It Means for California
Apple employs tens of thousands of workers across the state, and its stock is baked into countless California retirement and investment accounts. A sustained slide wouldn't just sting shareholders. It would weigh on the broader Bay Area economy, which has leaned on big tech valuations for years. Whether this is a one-day reaction or the start of something longer hasn't been confirmed yet.
What We Don't Know Yet
How far the stock actually falls, the full context of Cook's "100-year flood" comments, and any response from Apple are all unconfirmed at this point. This is a developing story and details may change as markets open.